Shriram Transport Finance Company Limited (STFC), the largest asset financing NBFCs in India, plans to enter the debt capital market on July 26, 2012 with a public issue of Secured Non Convertible Debentures ( NCDs) of face value of Rs.1,000 each, aggregating upto Rs. 300 crores with an option to retain over-subscription upto Rs. 300 crores for issuance of additional NCDs aggregating to a total of upto Rs. 600 crores.
The Issue shall be open for subscription from July 26, 2012 to August 10, 2012 with an option to close the Issue on such earlier date or extended date as may be decided at the discretion of the duly authorised committee of Directors of the Company subject to necessary approvals.
The debentures will be offered on a first come first serve basis. The Shriram Transport Finance has reserved 80% of the issue for retail investors. 40 per cent of the issue is reserved for individuals investing more than Rs. 5 lakh and 40% for retail investors investing up to Rs. 5 lakh. Investors have the choice to receive interest either annually or through the cumulative option.
In the first option, where the tenure is three years, interest of 11.15% shall be paid on an annualized basis to individuals, while in the case of non individuals and HNIs, the interest rate payable will be 10.25%. If you opt for the cumulative option, Rs. 1373.19 shall be paid to retail investors at the end of 3rd year, while Rs. 1340.1 shall be paid to non individual investors.
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| NCDs by Shriram Transport Finance |
The second option which has 5 year tenure, gives investors a return of 11.4% interest per annum, while non individuals will get 10.5% per annum.
If you go for the cumulative option here Rs. 1716.15 will be paid to individuals while Rs. 1647.90 shall be paid to non individual investors.
Rating of the NCDs..!
The NCDs proposed to be issued under this Issue have been rated ‘CRISIL AA/Stable’ by CRISIL for an amount of upto Rs. 600 crores & ‘CARE AA+' by CARE for an amount of upto Rs. 600 crores.
The rating of the NCDs by CRISIL and CARE indicates high degree of safety regarding timely servicing of financial obligations and carrying very low credit risk. The NCDs offered through the Prospectus dated July 16, 2012, are proposed to be listed on the NSE & the BSE.
The funds raised through this Issue, after meeting the expenditures of and related to the Issue, will be used for STFC’s various financing activities including lending and investments, for repaying the existing loans and for the business operations including capital expenditure and working capital requirements.
JM Financial Institutional Securities Private Limited, A.K. Capital Services Limited, ICICI Securities Limited, Kotak Mahindra Capital Company Limited are the Lead Managers to the Issue.
About Shriram Transport Finance Company Limited:
Shriram Transport Finance Company Limited (STFC) is a part of the Shriram group of companies which has a strong presence in financial services in India, including commercial vehicle financing, consumer finance, life and general insurance, stock broking, chit funds and distribution of financial products such as life and general insurance products and mutual fund products.
Incorporated in 1979, Shriram Transport has a long track record of over three decades in the commercial vehicle financing industry in India and is today the largest asset financing NBFC in the country. It has a widespread network of 502 branches across India as of March 31, 2012. Based in Mumbai, it manages assets worth Rs. 40,307 crores and has a customer base of over 8,50,000 across India, as of March 31, 2012.
Photo caption:
Left to Right: Mr.Sanjiv Ferreira, ICICI Securities, Mr.Umesh Revankar, MD, STFC, Mr.Sridharan, COO, STFC
For any further information please contact:
U.Christopher Charles, Mob: 98424 75706,
E mail: charles@conceptpr.com>
R.Vellaichamy, Mob: 98845 52209, Concept PR.
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